Natural Gas Tests 200-Day Resistance and Stalls
Natural gas rallied early Monday, reaching a session high of $3.49 before encountering significant resistance near the 200-Day moving average. That move followed a brief dip to a four-day low of $3.30 before buyers stepped back in. However, price remains within the lower half of the daily range, reflecting waning intraday momentum. If natural gas closes the day near current levels, it will indicate short-term weakening in sentiment. A daily close below Friday’s high of $3.45 would also confirm a failed one-day bull breakout — a signal that often precedes a deeper retracement.
Cluster of Resistance Indicators Suggests Downside Risk
The recent rejection near $3.59 gains added technical significance given the confluence of resistance factors at that zone. A bearish bat harmonic pattern has formed near last week’s high, while the 200-Day moving average, the upper boundary of a descending trend channel, and the 127.2% Fibonacci projection of the rising ABCD pattern all converge in the same region. This combination reinforces the probability that natural gas may be facing exhaustion following its recent recovery phase.
Watching Key Support Levels for Reaction
Initial support now lies near $3.20, where short-term buyers may attempt to defend the trend. Below that, the 20-Day moving average around $3.10 represents a more critical dynamic support area. The rising ABCD structure remains corrective in nature, implying that the larger bearish channel still dominates the broader trend. A move above $3.59 would be required to invalidate this bearish bias and confirm that a new swing higher is developing. Until then, rallies are likely to face resistance on approach to the 200-Day line.
Weekly Perspective: Neutral Within a Broad Range
On the weekly chart, natural gas continues to trade inside last week’s broad range from $3.13 to $3.59. This keeps the larger trend technically neutral for now, as no breakout signal has yet emerged on that timeframe. Meanwhile, the 20-Week moving average, currently around $3.27, offers potential support should weakness deepen. Price action around this area will be key in determining whether natural gas stabilizes for a new swing higher or resumes its longer-term downtrend.
For a look at all of today’s economic events, check out our economic calendar.
